New Yorker: health care reform
Source Dave Anderson
Date 10/04/13/20:05
by Atul Gawande

In July 30, 1965, President Lyndon Johnson signed Medicare into law.
In public memory, what ensued was the smooth establishment of a
popular program, but in fact Medicare faced a year of nearly crippling
rearguard attacks. The American Medical Association had waged war to
try to stop the program, and doctors weren’t about to abandon the
fight against “socialized medicine” simply because it had passed into
law. The Ohio Medical Association, with ten thousand physician
members, declared that it would boycott Medicare, and a nationwide
movement began. Race proved an even more explosive issue. Many
hospitals, especially in the South, were segregated, and the law
required them to integrate in order to receive Medicare dollars.
Alabama’s Governor George Wallace was among those who encouraged
resistance; just two months before coverage was to begin, half the
hospitals in a dozen Southern states had still refused to meet
Medicare certification.

Either boycott could have destroyed the program. Hundreds of thousands
of elderly and black patients would have found their hospitals and
doctors’ offices closed to them. But, as David Blumenthal and James A.
Morone recount in “The Heart of Power,” their riveting history of
health-care politics, Johnson recognized the threat and outmaneuvered
his opponents. With the doctors, he cajoled and compromised, giving
the A.M.A. a seat on an advisory council that oversaw the rules and
regulations, and working with it on a series of thirty “improving”
amendments to the legislation. With hospitals, however, the President
brooked no compromise. He convened a battle council of top advisers;
set Vice-President Hubert Humphrey phoning mayors to pressure
resistant hospitals; and deployed hundreds of inspectors to make sure
that participating hospitals integrated their wards. There was fury
and acrimony. In the final weeks before Medicare’s start, though, the
hospitals decided to abandon segregation rather than lose federal
dollars. Only then was Medicare possible.

The health-reform bill that President Obama signed into law last
week—the unmemorably named Patient Protection and Affordable Care
Act—could prove as momentous as Medicare. Yet, because most of its
provisions phase in more slowly than Medicare did, they are even more
vulnerable to attack. The context, of course, is different. As Robert
Blendon, of the Harvard School of Public Health, points out, the war
against health reform in 2010 has not been an interest-group battle.
The A.M.A. endorsed the legislation; hospital associations were

Once the public option was dropped, most insurers favored the bill.
The medical world will wage no civil resistance. This time, the threat
comes from party politics. Conservatives are casting the November
midterm elections as a vote on repealing the health-reform law. If
they regain power, they are unlikely to repeal the whole thing. (No
one is going to force children with preëxisting conditions back off
their parents’ health plans.) Instead, they will try to strip out the
critical but less straightforwardly appealing elements of reform—the
requirement that larger employers provide health benefits and that
uncovered individuals buy at least a basic policy; the subsidies to
make sure that they can afford those policies; the significant new
taxes on household incomes over two hundred and fifty thousand
dollars—and thereby gut coverage for the uninsured.

Opponents may also exploit the administrative difficulties of creating
state insurance exchanges. The states have four years to prepare, and
creating an exchange is, in theory, no more complicated than what
states do in providing health-benefit options to public employees.
Massachusetts, which has achieved near-universal coverage this way,
had its exchange working in six months. Still, with fourteen state
attorneys general already suing to stop parts of the reform, some
states may refuse to coöperate, forcing a showdown.

The major engine of opposition, however, remains the insistence that
health-care reform is unaffordable. The best way to protect reform, in
turn, is to prove the skeptics wrong. In 1965, health care consumed
just six per cent of U.S. economic output; today, the figure is
eighteen per cent. Nearly all the gains that wage earners made over
the past three decades have gone to paying for health care. Its costs
are curtailing all other investments in the economy, and, if they
continue to rise as they have been doing—twice as fast as
inflation—the reform’s subsidies, not to mention America’s prosperity,
will indeed prove unsustainable.

But the reform package emerged with a clear recognition of what is
driving costs up: a system that pays for the quantity of care rather
than the value of it. This can’t continue. Recently, clinicians at
Children’s Hospital Boston adopted a more systematic approach for
managing inner-city children who suffer severe asthma attacks, by
introducing a bundle of preventive measures. Insurance would cover
just one: prescribing an inhaler. The hospital agreed to pay for the
rest, which included nurses who would visit parents after discharge
and make sure that they had their child’s medicine, knew how to
administer it, and had a follow-up appointment with a pediatrician;
home inspections for mold and pests; and vacuum cleaners for families
without one (which is cheaper than medication). After a year, the
hospital readmission rate for these patients dropped by more than
eighty per cent, and costs plunged. But an empty hospital bed is a
revenue loss, and asthma is Children’s Hospital’s leading source of
admissions. Under the current system, this sensible program could
threaten to bankrupt it. So far, neither the government nor the
insurance companies have figured out a solution.

The most interesting, under-discussed, and potentially revolutionary
aspect of the law is that it doesn’t pretend to have the answers.
Instead, through a new Center for Medicare and Medicaid Innovation, it
offers to free communities and local health systems from existing
payment rules, and let them experiment with ways to deliver better
care at lower costs. In large part, it entrusts the task of devising
cost-saving health-care innovation to communities like Boise and
Boston and Buffalo, rather than to the drug and device companies and
the public and private insurers that have failed to do so. This is the
way costs will come down—or not.

That’s the one truly scary thing about health reform: far from being a
government takeover, it counts on local communities and clinicians for
success. We are the ones to determine whether costs are controlled and
health care improves—which is to say, whether reform survives and
resistance is defeated. The voting is over, and the country has many
other issues that clamor for attention. But, as L.B.J. would have
recognized, the battle for health-care reform has only begun. ♦

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